Which of the following properly describes the interest-rate effect that helps explain the slope of the aggregate-demand curve?
a. As the money supply increases, the interest rate falls, so spending rises.
b. As the money supply increases, the interest rate rises, so spending falls.
c. As the price level increases, the interest rate falls, so spending rises.
d. As the price level increases, the interest rate rises, so spending falls.
d
You might also like to view...
The table below shows the relationship between the number of times you get your car washed each month and your total monthly benefit from car washes. Each car wash costs $15.Number ofCar WashesPer MonthTotal MonthlyBenefit fromCar Washes0$01$202$363$484$565$60How many times a month should you get your car washed?
A. 4 B. 3 C. 2 D. 1
Suppose in year 1 the CPI is 90, in year 2 the CPI is 100, and in year 3 the CPI is 110. Then, inflation is
A) 11 percent between years 2 and 3. B) 11 percent between years 1 and 2. C) 100 percent in year 1. D) 10 percent between years 2 and 3. E) Both answers B and D are correct.
If the change in the y-axis variable is 6 and the change in the x-axis variable is 5, the slope of this line is 6/5
Indicate whether the statement is true or false
Which of the following statements is true?
A) If both demand and supply increase, there must be an increase in equilibrium price; equilibrium quantity may either increase or decrease. B) A decrease in demand causes equilibrium price to fall; the decrease in price then results in a decrease in quantity supplied. C) A decrease in demand causes a decrease in equilibrium price; the decrease in price causes supply to decrease. D) If demand decreases and supply increases one cannot determine if equilibrium price will increase or decrease without knowing which change is greater.